When Law is Made for Merchants

Observers frequently assume markets are sources of illegality, particularly in taxation or merchandise acquisition.  Clearly some merchants in some places do break some laws, but so weak a contention can be leveled at storefront business, government officials and manufacturers, all of whom digress from law, ordinance and commonly accepted behavior and such digressions help make possible merchants digressions from law, ordinance or commonly accepted behavior.  Yet turn this notion upside down.  Since their inception laws have been made for markets, not the other way around.  Markets and merchants have been exceptions to laws, just as corporations and the rich avoid many laws today.  But, unlike the rich, merchants often seek reasons to maximize their tax liability in order to get access to credit markets from which the marginalized are excluded.  Thus, with respect to some “illegal” behavior, we find merchants and markets would provide richer social benefits if, as historically, they were regulated distinctly from the rest of society, and eventually incorporated into that society.   

Take taxation, do merchants evade taxes, do they minimize tax liability?  Yes, as do businesses and households.  Some people use evasion to make a political, social or economic point, for instance they withhold taxes because they believe a war or wars generally are unjust, or they evade taxes because they perceive inequality in education and send their children to private schools or they believe it unjust that large corporations are given tax breaks and feel their business deserves similar treatment.  But when do most businesses or corporations seek to increase their tax liability?  What rationality is in that?  But it is precisely the case with street merchants who purposefully increase their liability when they wish to supplement their street business with storefront business or when they hope to move from street to store.  Access to credit markets demands proof of profitability!  Absent the political connections or track record of profits, vendors have no choice but to demonstrate their ability to pay taxes, they do so by paying more than liable, and establishing without question, their creditworthiness and by proxy, ability to run a business.   

Thus, we find that one’s perspective is particularly salient with respect to criminality.  This charge of fostering illegal behavior is perhaps the most severe charge against markets and merchants, but it comes from shoehorning them into assumptions of storefront or contemporary retail practices, practices for which merchants are unsuited, but are often attempting to access.  Instead of condemning markets and vendors some allowance should be made for their unique activities contributing to economic and social and other goals.  In this sense markets should leverage aspirations for mobility and become a policy tool to encourage entrepreneurship, merchants should not languish in an economic purgatory, but instead occupy a transitional space where their activities contribute to their household and neighborhood and can eventually produce conventional businesses.